Signature Devices, Inc. (PINKSHEETS: SDVI) in Redwood, CA announced today that it has finalized a joint venture deal with Yamani Pictures to develop and publish a video game based on the studio's feature film titled "Only the Hood Does Young." According to the terms of the agreement Yamani shall pay Signature Devices, Inc. 5 million dollars to develop the product which Graffiti Entertainment will then manufacture and distribute worldwide. Yamani will receive royalties from the game sales and stock of less than 10% in the company for the investment. Yamani will also contribute capital towards the marketing efforts of the game. The game is scheduled for release in mid 2011.
Do you honestly think that RJ and others on SDVI management aren't being compensated with SDVI stock? I am sure that a lot of these guys are working for far less than what the big name companies like EA would pay them. You know why they are working for SDVI? They are doing it because they could make some big bucks with the stock that they have received. They are expecting to make far more money on SDVI stock than what they would be paid in money from a similar entertaiment company with the time that they have invested in the company.
SDVI is having a similar approach with the Yamani funding. Yamani is giving SDVI 305 million dollars for a small stake in SDVI and thus SDVI will have to give so many shares to Yamani as well.
Both management and the company funding the aquisitions of SDVI are being compensated with stock. I don't see why this is a problem considering that they are expecting to make far more money in the long run than what their initial investment (time/money) is.
It is my opinion that SDVI is compensating SDVI management, but it it pretty obvious to me that this is the only reason why SDVI can afford such high quality management personnel.
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